Findings of the Targeted Survey

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Testing of the Unified Application Form and Exclusion Error of

the Nominative Targeted Compensations Program

Findings of the Targeted Survey

of the Cucuruzeni Rural Community Population, Orhei District

Presented by LIESAP on 1 July 2003

English version

Center for Strategic Studies and Reforms (CISR)

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LIESAP / Counterpart International, Inc.

Center for Strategic Studies and Reforms (CISR)

Testing of the Unified Application Form and Exclusion Error of

the Nominative Targeted Compensations Program

Findings of the Targeted Survey

of the Cucuruzeni Rural Community Population, Orhei District

The study was carried out with financial support of USAID/Low Income Energy and Social Assistance Project. The views expressed herein are those of the authors and do not necessarily reflect the views of the USAID or the Government.

Chisinau, April 2003

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Abstract

Transformation of the social assistance to targeted population in Moldova is gradually advancing along the correct direction: from privileges, which almost one quarter of the population enjoyed before 2000, to Nominative Targeted Compensations (NTC) for some categories of the population (2000-2003) and, finally, to the third, the most difficult stage – transition to social assistance based on needs.

The last step is yet to be taken. With a view to prepare its realization, on the initiative of the National House of Social Insurance (NHSI), Counterpart International, Inc./ LIESAP and local authorities there is being undertaken approbation of the “Cerere pentru protecţie

socială” – Unified Application Form (UAF). The UAF is used as a data collection instrument to reveal real needs of households.

For the first time in Moldova it was decided to choose the whole population of a rural

community – Cucuruzeni (8 villages with 4755 inhabitants) – as social totality of this research.

Evaluation of the level and different aspects of their welfare, incomes and expenditures, including NTC beneficiaries has been carried out. NTC exclusion error has been discovered.

There have been established groups of persons who applied for Social Assistance (SA)

program (NTC) and of those who could, but did not apply for other types of SA. Proposals on UAF improvement have been made in order to increase its contribution to revealing real poverty.

Introduction

The present work was carried out on the initiative of the National House of Social Insurance (Tamara P. Shumskaia) with support of the Counterpart International, Inc.’s Low-Income Energy and Social Assistance Project (Terry T. Campo). The Unified Application Form is being considered by the NHSI after being developed through close cooperation between the MoLSP (as the Ministry highly regards its input in development of the UAF) and LIESAP in consultation with several of the NHSI’s Territorial Offices and the State Department of Statistics and Sociology, with substantial input from other international donors such as the British DFID and EC Food Security Program. It is hoped that the UAF will help reduce

exclusion error present in the category-based targeting of nominative compensations and other forms of social assistance. Further, that the data collected in the UAF can be loaded into a database used for targeting all forms of social assistance, possibly including a mechanism to reduce inclusion error.

Executor of the research – nongovernmental organization Center for Strategic Studies and Reforms (CISR) – had to prepare Survey of a large social group based on a single rural community situated in Orhei district and on utilization of the UAF as a data collection instrument. Pros for that are as follows.

First, at the moment this form is used for application for SA and FSSP programs in Orhei and the data is stocked in a standardized way in a database, which allows future comparison of the information collected from the survey and from the daily activity of SA and FSSP offices. As part of the Ministry of Labor’s evaluation of the UAF, a version of it is used to apply for programs administered by the Department of Social Assistance (in Chisinau and Orhei) and the Fund for Social Support of the Population (Orhei district). Second, this will allow

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introducing this information into the UAD/VHDb, increasing share of population covered by the pilot project in Orhei. Third, as the information collected covered all types of households, comparison with vulnerable households is possible. The welfare information collected using UAF corresponds partially to the HHBS making possible interpolating results if the survey with the HHBS.

The object of the research included the whole population of the Cucuruzeni community consisting of 8 villages where 4,7 thou people live.

The goals were to evaluate welfare and social status of the community population in order to provide analytical information on NTC targeting efficiency and to assess whether there is a substantial difference between those who “self-select” by applying for various forms of SA and the general population. Besides that, there were set particular tasks: to obtain information related to the NTC exclusion error in rural areas of the central part of Moldova making possible future interpolation over the whole Moldova’s territory; to reveal persons who applied for SA program (NTC) and those who could, but did not apply for other types of SA;

to obtain information related to welfare of the sample, including social status of households, main income sources and expenditures articles; to elaborate proposals on the UAF

improvement.

Work organization. The research was performed by the CISR working group in close collaboration with the Counterpart/ LIESAP team. Moreover, contacts were kept with the Ministry of Labor and Social protection, National House of Social Insurance, Department of Statistics and Sociology, as well as with other projects oriented at social protection of the population during the transitional period and poverty alleviation.

The Survey was carried out by: a) CISR working team, assigned to work out methodology of the research; b) unit of fieldwork coordinators and on-field operators-interviewers (31); c) programming and data processing group and d) creative teamwork for preparation of preliminary and final versions of the paper.

The research was done during March – April 2003. Authors of the paper are as follows:

Anatol Gudim, Anatol Bucatca, Andrei Tsurcan (CISR), Valentin Tsurcan and Ion Jigau (State University of Moldova).

1. Logics of Transformation of Moldova’s Social Assistance System: Mass Privileges – NTC to Certain Categories –

Social Assistance Based on Needs

By the end of the first decade of the transition in the Republic of Moldova there has been cancelled system of privileges (heritage of socialism) since state budget was not capable anymore to bear the load of rendering social assistance – in one or another form – to every fourth inhabitant of the country.

The Parliament approved Strategy of Social Assistance System Reform (May 1999) and oriented it towards “coherence and more complete satisfaction of wants of needy individuals and families that are not able to provide themselves for; creating a sound, in the terms of taxation, system that shall be oriented towards people’s needs with due consideration of the state resources”. The following items were considered to be main ideas of the reform of social

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assistance system: clear targeting of granting both cash and non-pecuniary benefits through testing mechanisms for this purpose; decentralizing the social assistance system, increasing the importance of local authorities in allocation of social assistance; strengthening capabilities of central and territory structures of the system of social assistance by development of

information technologies, implementing systems of identification of social assistance

beneficiaries (individuals and families), increasing a level of organization of rendering social assistance considering the procedure of its granting, making out documents and benefit payment; monitoring of efficiency of various types of social assistance and reallocation of resources among them; etc. (see: Parliament Decision # 416-XIV of May 28, 1999).

Starting such fundamental reformation of the social aid system, the Parliament had to act in real conditions: low income of majority of the population, limited financial resources and institutional capacities. Taking all this into account, search for compromises between

coverage (share of poor who get allowances), targets (share of funds allocated for allowances that are received by poor citizens) and efficiency (share of allowances as compared to average expenses of households) was inevitable.

The state is forced to implement reformation of the social protection system in such

conditions, when the population still remembers the former socialist system, which provided for a high-level protection, that the population wants to enjoy at present as well, in spite of economic depression, reduction of employment and limited state budget resources for social assistance.

Nonetheless, the Parliament and Government decided to make fundamental changes – to give up the system of benefits introduced during the soviet era. In the Republic of Moldova at the beginning of 2000 there were 447540 persons entitled for benefits (circa 12% of the

population) in 37 categories. Total cost of benefits was estimated to be 36755 mil MDL (30 mil USD)¹, only 207 mil MDL of which (17 mil USD) were provided for by the state budget.

Large part of these means was directed to benefits in the area of public utilities.

Unlike other regions of the world, in post-Soviet countries, including Moldova, where large investments were made in the infrastructure in the past, the poor have full-scale access to utility services. Thus, in Moldova (2001) almost 100% of households are connected to electricity supply system; natural gas or gas-cylinders are available to 71,8%; telephones to approximately 60%; and central heating, hot water and running water to – 30,0%-33,0% of households. At the same time, multiple increase of tariffs that took place during the 90’s at the time of reduction of income of the majority of the population created serious problems for the population.

Being aware of that the situation is unstable, the Government and Parliament made several actions for its stabilization. Based on experience of 1997 – 1999 of rationalization of social assistance in this area, the Parliament approved targeted compensations scheme and revoked benefits introduced by previous laws and decisions of the Government in April 2000.

In their stead, Law on Special Social Protection of Some Categories of the Population # 933- XIV of April 14, 2000, stipulated granting of targeted compensations for public utilities payment (electric energy, natural gas used for heating, liquefied natural gas in cylinders used for cooking, coal and firewood), which are considered to be the most difficult to pay for.

1 Making Transition Work for Everyone: Poverty and Inequality in Europe and Central Asia.

World Bank, 2000, Chapter 9.

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Targeted compensations program, which since the second half of 2000 covered more than 250,0 thou persons of 9 categories at first and later - 11, meant to strengthen efficiency of social protection of the population of scanty means in the field of payment for public utilities and energy resources based on the following criteria: importance of compensations for payment for public utilities and electric energy; timeliness and completeness of

compensations received; accessibility to the system of compensations.

Law of the Republic of Moldova on Special Social Protection of Some Categories of the Population # 933-XIV of April 14, 2000, is still in effect (with amendments introduced by the Law # 477-XV of September 28, 2001.

It should be mentioned that the given Law defines targeted compensations as a pecuniary payment that is made instead of the previously set benefits for public utilities payment. It is the first act to provide for a distinct definition of a single pensioner – a person who lives in an apartment alone and has no children, or has children under the age of majority or children that belong to a category of persons entitled to compensations under the given Law.

In accordance with the Government Decision # 761 as of July 31, 2000, compensations are paid to the following categories of the population:

1. Disabled of groups I and II regardless of the reason of their disability;

2. The following categories of disabled of III-rd group with a disability group established without time-limit;

a) labor veterans;

b) individuals recognized as disabled as a result of severe injuries, traumas or wounds, occurred during execution of military duties;

c) participants of the military actions for defending the integrity and independence of the Republic of Moldova;

d) victims of political repressions during the period of 1917-1990;

e) former prisoners of concentration campuses and ghettoes;

3. disabled children under 16 years;

4. disabled from childhood;

5. participants of WWII and their spouses, depending on circumstances;

6. persons whose status is equal to that of the veterans of WWII;

7. families (parents, or spouses, who did not get married for the second time, or their children until the age of adolescence) of individuals who were lost on execution of service duties and deceased as a result of participation in the liquidation of Chernobyl Atomic Power Station consequences;

8. single pensioners;

9. families with four or more children under 18;

10. persons that worked in the back areas during the WW2;

11. persons that were in Leningrad during its blockade.

Targeted compensations are being set depending on normative cost of monthly consumption:

- at the rate of 50%: invalids of groups I and II (except invalids of group II due to general or occupational disease, labor injury); invalids since childhood of groups I and II; persons listed under paragraphs from 3) to 8);

- at the rate of 25%: invalids of group II due to general or occupational disease, labor injury;

invalids since childhood of group III; persons listed under paragraphs 2) and 9).

Targeted compensations are paid directly to beneficiaries from the state budget through the National House of Social Insurance. 212909,0 thou MDL were provided for these goals in 2002, which makes up 54,3% of the total amount of means transferred from the state budget

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to the National House of Social Insurance for payment of pensions, allowances and compensations.

Almost three-year experience of the NTC SA program functioning revealed both positive and negative aspects. Positive ones include fivefold reduction of the number of beneficiaries, reduction of the burden upon the state budget of social insurance, decentralization of the SA system, simplification of procedure of setting, formalizing of papers and payment of benefits.

Besides these undisputable advantages, there also became apparent deficits of the NTC program and possibilities of its further improvement.

Primarily, these are deficits inherent to any targeted compensations system based on the principle of categories, when social aid is rendered to citizens according to their formal affiliation with one or another social group without taking into account their needs.

First of all, it was discovered² that there is a rather considerable inclusion error and insufficient aiming of SA at those in real need.

Thus, collations and calculations carried out on the basis of the database of Surveys of Budgets of Households for year 2001 show that the families that receive compensations for payment of public utilities and electric power do not necessarily belong to those in extreme need in the country. Moreover, they have a higher rate of disposable income than the average for the aggregate of the country household. In urban area in those families the available average disposable per capita income made up 335.30 MDL (25.6 USD) per month in year 2001 that exceeds the average income for the aggregate of urban households by 13.7%. In villages beneficiaries of compensations the monetary income of 213.17 MDL (16.3 USD) which is by 1.6% higher than it was on average for all the rural households. Amount of compensations is highly differentiated by quintiles of arranged incomes. The amount of compensations per one member of the most well-to-do households out of Y quintile, makes 2.63 MDL which is by 8.8 times more than it is of members of poor households out of I quintile group – 0.30 MDL.

The main conclusion drawn from this analysis is that there are significant and unjustified in respect to social justice differences in the quintile distribution of volumes of compensations for payments of public utilities and electric carriers: 20% of the poorest households dispose of 4.5% of the total value of compensations while 39.2% of all the compensations fall on 20% of the most well-off households.

Simple comparison of the above-mentioned data with parameters of the real poverty zone in Moldova leads to the conclusion that selection of composition of the NTC beneficiaries’

categories is not necessarily linked to determination of real financial status of persons and families enjoying compensations and other types of assistance. On the one hand, the NTC beneficiaries now include persons who are in zone of extreme poverty permanently (single pensioners and families consisting of the disabled). On the other, as in other post-soviet countries, current practice does not lack political tinge, which is evident from setting of social aid to some categories of citizens without taking into account financial status of their families (compensations to victims of political repressions during 1917-1990, participants of military operations for protection of territorial unity and independence of the country and some other).

Without calling in question moral motives of assistance to persons that suffered during historical process, nonetheless, by virtue of limited financial resources assistance to such persons should be made conditional upon their real financial situation.

2 Evaluation of the Social Assistance to Targeted Population through the NTC Program. LIESAP/ CISR, Chisinau, 2002.

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Taking into account the above mentioned important circumstances the Ministry of Labor and Social protection, National House of Social Insurance in collaboration with the USAID project – Low-Income Energy and Social Assistance Project (Counterpart/ LIESAP) – took the initiative to elaborate methodology of gradual transition to the new system of targeted compensations, which would be based on the principle of application and be determined in dependence on family’s income.

With this point in view the Unified Application Form has been worked out (See: Annex) that is being tested in territorial NHSI bodies of the Orhei district. At the same time the CISR’s task was to prepare Survey of the focus group (one rural community) situated in Orhei district using the UAF as a data collection instrument.

On suggestion of the NHSI and Orhei district prefecture Cucuruzeni community uniting 8 villages of different size with the total population of 5 thou people as an object typical for the central region of Moldova.

2. Object for Testing the Unified Application Form:

Population of the Cucuruzeni Rural Community, Orhei District

Selection of the Cucuruzeni rural community, Orhei district, for testing the Unified Application Form was conditioned by the following circumstances:

a) the community is a typical rural community of the central region of Moldova as regards both population and number of households and employment structure,

education, incomes and poverty rate. NTC beneficiaries within its population account for 7.66% (December 2002), which is practically identical to the average indicator in rural areas of Moldova – 7.4%;

b) the community is situated in the rural “depth” outside the zone of impact of urbanized territories or intensive transport flows and includes villages of different population number and different economic activity rate;

c) the community includes a village (Cucuruzeni) that belongs to the group of 45 villages where since 1997 the Department of Statistics and Sociology has been routinely examining households budgets. This circumstance presents an additional possibility to assess “capacity for work” of the Unified Application Form.

Social totality for testing the UAF covered the whole population of the Cucuruzeni community – 4755 persons united in 1,870 households. Examination carried out by CISR with participation of the NHSI territorial unit in March – April 2003 managed to cover 94.0%

of population (4,461 persons) and 81.0% of households (1515 households), which is a quite representative sample. While the number of refusals to answer was minimal, the predominant cause of inability to receive information was absence of any inhabitants in houses, mainly due to departure of main household members abroad for work.

The most generalized characteristics of the community population revealed by means of the UAF are as follows:

• 56.7% of households are families consisting of three and more persons. At the same time, as compared to the previous period share of households where 1-2 persons live increased (up to 43.3%), which is a quite alarming signal that villages become depopulated. Single persons make up 37% (!) of the community population;

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• 2/3 of households are headed by men and 1/3 – by women;

• educational level of population is rather high: higher education – 7.8%, specialized secondary education – 17.4%, general secondary education – 50.0%, primary – 24.3%;

• nature of employment reflects transformation processes that take place in Moldovan villages after the land privatization of 1998-2000. Before that time there were 2 sovkhozes, 1 kolkhoz and 1 state agricultural college (Cucuruzenii de Sus) on the community’s territory. Now the predominant form of entrepreneurship on the basis of private property is farmers’ enterprises (1,268 units), associations of farmers’ enterprises and limited liability companies;

• population of the community disposes of 7,87 thou ha of agricultural land, including arable field – 4,16 thou ha, orchards – 889 ha, vineyards – 228 ha. Technical equipment – 48 tractors (including 5 new ones), 9 combine-harvesters and 15 trucks;

• incomes of the population result from agricultural activity on privatized land plots (1,7 ha on the average), from leasing out land, employed work (26% of the population), as well as from wages of single members of households (mainly those 24-45 years old) working abroad. There are 400 of those working abroad in the community, or ¼ of the total number of those able for work;

• living conditions of the majority of the population are characterized by availability of private houses (85.4% households) or state apartments (4.9%), TV sets (72.4%), refrigerators (47.5%), clothes-washers (33.3%), automobiles and motorcycles (16.1%).

75% of households are provided with gas, including 13.8% - by means of gas pipes and 61.2% - gas-cylinders. 18.0% of the poorest households do not have gas. Running water is available only to 8.5% households. The heating is mostly stove-based (92.6%

households). Only 5.7% dispose of gas heating;

• rural entrepreneurship within the community is underdeveloped. The causes are: lack of sufficient financial resources (including difficulties of getting credits at commercial banks), of necessary infrastructure (transport, agricultural chemistry, veterinary services, seed-farming, etc.) and information. Grain is mainly sold to intermediary firms, milk – to Chisinau (S.A. Lapte) and Braviceni (to the private cheese dairy factory), fruits and vegetables – to the Orhei canning and winemaking factory. Realization of meat is still unregulated. Prices are being dictated by buyers to the prejudice of farmers’ enterprises.

Contacts of the community population with social institutions and organizations (their frequency and composition) reflect social needs of the people quite representatively.

According to the UAF the largest number of addresses falls at post-offices (85.5%

households), polyclinic (49.3%) or hospital (16.4%), followed by school – primary and secondary - (15.6%) and very seldom – cultural institutions: libraries (9.5%), clubs, cinemas (1.3%). One third of households (36.0%) addressed local authority bodies – village or community mayor’s office, which is quite often.

Using UAF as an examination instrument allowed both obtaining information on different aspects of living of households and establishing that lower incomes contingent (poverty zone) is much larger than the NTC beneficiaries contingent, i.e. revealing the exclusion error.

Besides, there were obtained quite “unexpected” data related to a series of aspects of life of the modern Moldovan village: about 10% households (153) – mainly young families – do not own land; families of those working abroad have the highest welfare rate; as rural healthcare system was destroyed self-treatment is widely practiced – share of expenditures for medicines is considerable within the households expenditures structure; 8.8% households (134) do not spend anything for electric power, etc.

It was discovered that one of the most serious impediments to socio-economic development of Moldovan villages (including development of non-rural employment in the SME sector) is

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underdevelopment of land market. Leasing out privatized land is one of the main sources of incomes for rural inhabitants. In majority (!) of cases this leasing out is not formalized due to different causes (verbal agreement based leasing out) and therefore it does harm both to peasants-lessors and the state due to under-collection of taxes. Thus, such situation can nit be considered successful.

In Moldova over 2/3 of agricultural lands are now privatized. As long as the size of the land share is not very large (1,5 – 3,0 ha in different districts), it is evidently insufficient for the effective farming. The issue on the agenda now is consolidation of land use. Due to different causes such types of land transactions as sale/purchase, exchange, donation or hypothecation in Moldova are still not widespread. Leasing out prevails. This can be explained by

Bassarabian peasants’ love for land. The rural residents having become again land share owners after 50 years of waiting will not give it up soon both due to economic and psychological motifs. In these conditions the state should assume the responsibility for creation of the lease-favorable surroundings: legal basis, credit and tax relations, services structures. All this makes the socio-economic relations in the rural area more civilized and acceptable both for peasants and for the state as a whole.

3. Socio-demographic Structure of the Community

3.1. Composition of Households

Households of the community are characterized by three forms of social organization: zero, binary and group.

Table 1 Distribution of the Cucuruzeni community population

by number of household members

Number of

households % Number of family members living

in a household % One person 330 21.8 330 7.4 Two persons 328 21.7 656 14.7 Three persons 253 16.7 759 17.0 Four persons 375 24.8 1500 33.6 Five persons 165 10.9 825 18.5 Six persons 52 3.4 312 7.0 Seven persons 9 0.6 63 1.4 Eight persons 2 0.1 16 0.3

No answer 1 0.1 - 0.1

Total 1515 100.0 4461 100.0

The zero group, i.e. the one that lacks any social structure, consists of a single household member. There are 21.8% of such households in the community. Binary form of social organization includes households consisting of two members. There are 21.7% of such households. This form cannot be considered group from of social organization since social relationships existing within them are underdeveloped and unstable.

Zero and binary forms of social relationships in households do not contribute to stability of their socio-economic life. It is the fact that there are 43.5% of them, which is evidence of the crisis nature of their social development.

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56.9% of community households belong to the group form of social organization, which is a little more than a half of their total number. This fact can be assessed as quite positive, in particular, taking into account that 16.7% of these households are at the border of binary and group forms. Only 39.8% of households relate to the developed and stable social organization form. These are households where there are 4 and more members.

3.2. Economic Activity

As regards form of economic activity the community population is divided into those economically active and those economically inactive.

Table 2

Persons %

Total population 4463 100.0

including:

Economically active population 1266 28.4

Employed population 932 20.9 Unemployed 334 7.5 Including registered unemployed 19 0.4

Economically inactive population 3197 71.6

Economically active population of the community accounts for 28.4% of the total population.

Inactive population accounts for 71.6%. As compared to annual data on the whole country, share of economically active community population is lower and share of those economically inactive is higher.

The unemployed in correlation with the economically active persons make up 26.4%. Hidden unemployment is of 7.8%. Thus, general share of the unemployed within the economically active population of the community is no less than 26.5%.

3.3. Vulnerable Categories of the Community Population

Analysis of these categories was done by each of them irrespective of their share within the community population.

a) Vulnerable categories of population Unemployed – 334 persons.

Students younger than 23. This category accounts for 155 persons. 61.7% of them (95 persons) study at the government expense and education of 38.9% (59) is student-paid.

Pregnant women – 8 persons.

Children. 100 of children can be considered vulnerable. 16 of them live with their single mothers. Parents of 38 children are divorced. 50 have only one parent. 2 are orphans and 4 are in ward.

The elderly. 13 persons enjoy social pension. 653 are pensioners and 72 are single pensioners.

In all this category of the community population includes 738 persons.

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Those living abroad are 247 persons. 227 of them work, 17 are students, 1 person went away for treatment and 2 for other causes.

Category of other vulnerable persons includes 73 persons. 11 of them are persons equated with the WWII participant. 61 are in the state of extreme poverty. And there is one person unemployed due to illness before incapacity for work.

b) Disabled

There are 163 of such persons in the community. 18 of them are children under 16, 32 are persons above 16 disabled since childhood, 97 are disabled, 4 are disabled veterans and 2 are those who suffered from the Chernobyl accident.

Table 3 Invalids by groups

1^st group 21 2^nd group 98 3^rd group 44

Total 163

Table 4

3^rd group termless and 2^nd group 57 Including:

3^rd group, labor 9 3^rd group, injuries 20 3^rd group, Transnistria military conflict participants 2 2^nd group, excluding those disabled due to illness 26

c) Persons that do not belong to any of the above mentioned categories – 887.

4. Dwelling of the Population and Property

4.1. Property and Dwelling Type

For the most part the community population possesses dwelling where private type of

ownership prevails over the other ones: 1355 households or 89.5% out of their total number.

Next follows state ownership – 3.1% and departmental ownership – 1.8%.

Table 5 Distribution of Households by Type of Ownership (number, %)

Type of Ownership Number %

State 47 3, 1

Departmental 28 1, 8 Cooperative 1 0, 1 Private 1355 89, 4

Rent 28 1, 8

Other 56 3, 8

1515 100, 0

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Rent of dwelling (1.8%) is not considerable at all in rural area. The reason of it is of ethno- cultural characteristics – to build a house for a rural Moldovan is a chief aim of his life.

Possession of a piece of land for building a house allowed almost every villager to make this dream come true.

A separate group makes a group of households which type of ownership on dwelling could not be defined by the respondents. As a rule, these are the households where type of

ownership is either transitional or has not been set yet. The households with dwelling during the process of privatization can be referred to this group.

There the following situation can occur: two families dwell in one house possessed by one house-owner by the right of ownership and the other does not formally possess this right.

The most widely spread type of dwelling in the community is the following: a detached house – 82.0%. Traditionally, every family in Moldova has had a possibility to get a plot of land for a self-dependent building of a house. On the other hand, an orientation to separate habitation of a mono- generation family has recently prevailed: a young family separates from the parents’ family, builds their own house thus becoming independent owners of housing.

Table 6 Distribution of Households by Type of Dwelling (%)

Dwelling Type Number % Separate apartment 15 1, 0

Hostel 3 0, 2

Detached house 1242 82, 0 Part of a house 226 14, 9 Other 18 1, 2 No answer 11 0, 7

Total 1515 100, 0

The studies prove that there a process of division of houses and division of households into two takes place. 14.9% of households live in this type of dwelling.

Separate apartments (1.0%) and hostels (0.2%) are not typical for rural settlements of Moldova. As a rule families of young specialists live in such dwelling.

4.2. Availability of Dwelling for Population

The need in dwelling is one of the main need of man. The level of availability of dwelling for the population witnesses to the way of his life. Since by definition a household should

possess dwelling space then the ratio of total and living space is of a great importance in the households.

Table 7 Distribution of Households depending upon Total Dwelling Area (%)

Total Area, (m²) Number of Households % Less than 20 m2 41 2, 7

21 - 50 410 27,1

51 - 80 573 37, 8

81 - 120 79 5, 2

Over 120 79 5, 2

Total 1515 100,0

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As we can see, the greater part of households (70.2%) has total living area of more than 50 m², this total living area corresponds at the minimum with a 3-room apartment in town.

Division of total living area into four quintiles results into equal, proportional division of households into five groups. Comparison of the first and fifth groups make it possible to assess an extent of difference in availability of total living area of community household.

Table 8

М² 10722. 50 14848, 10 19963, 20 28209, 0 33443, 6 107186, 4

%% 10, 1 13, 8 18, 6 26, 3 31, 2 100, 0

As we see in the Group Five of households the size of total living area is three times higher than in Group One. On average there are 33.3 m² of total living area per one household in Group One and in Group Five – 120.3 m².

Table 9 Distribution of Households depending upon the size of living area, (%)

Living area (м²) Number of Households %%

Less than 6 12 0, 2

7-12 83 5, 5

13-20 161 10, 6

21-40 541 35, 7

41-80 637 42, 0

81-120 74 4, 9

Over 120 7 0, 5

Total 1515 100, 0

Availability of living area in the households of the community seems to be rather safe: 46.3%

of them possess living area that is comparable with a two-room apartment in town and 47.4%

- with a three- and more rooms apartment.

At the same time there are 0.2% of the households where living area is less than 6 m2, and 5%

of households - from 7 to 12 m2.

Table 10 Division of living area into 4 quintiles results in the following grouping of households

М² 5158, 9 8599, 3 11908, 8 16226, 8 23647, 1 65540, 9

% 7, 9 13, 1 18, 2 24, 7 36, 1 100, 0 Average size м²

М² 16, 3 29, 0 40, 2 53, 9 78, 6 43, 3

As can be seen, if on average per one village in the community there are 43.3 m2 then in Group One there are only 16.3 m2, and in Group Five – 78.6 m2. The number of living area in households Group Five is by 4.6 times higher than in Group One.

4.3. Dwelling Quality

A. Number of Habitable Rooms in Household

Dispersion of the number of habitable rooms in households in the community is from 1 up to 8 rooms. At that, if 10.1% of population dwell in one-room households, only 0.1% live in 8- room households. The most widely met number of rooms in the households is 2 (32.1%) and 3 habitable rooms (29.9%).

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Table 11 Distribution of Households by Number of Habitable rooms, (%)

Number of Rooms Number of Households %

1 153 10, 1

2 487 32, 1

3 453 29, 9

4 265 17, 5

5 87 5, 7

6 30 2,0

7 4 0,3

8 2 0,1

No answer 34 2,2 Total 1515 100, 0

Thus, 2-3 rooms households in the community prevail over the other – 62%. Availability in a household of 2-3 habitable rooms in general corresponds to a living space rate that has set in the country. This number of habitable rooms all in all corresponds both to a family type and to the number of members in the family. Availability of 4 and more habitable rooms reflects higher requirements of the owners towards dwelling and proves a higher than average well- being of the household. It should be noted that in this community 25.6% of the population live in households with 4-8 rooms in the houses, which in a number of cases is rather a sign of former than present time well-being.

It should be also taken into account that there is a custom in Moldovan rural area culture to furnish one more room as habitable but not to live in it. This is so called “casa mare” that serves as a symbol of culture and wealth of the family.

B. Ownership of Extra Dwelling and Garages, %

A part of households (3.9%) besides the basic dwelling possess an ownership of another type of dwelling. Extra property is subdivided into two types: house/apartment or a part of a house - 2.9% and a summer or winter cottage - 0.8%. It is obvious that the owners of extra

dwelling refer to rather well-to-do part of the inhabitants of the community. The cost of dwelling in rural area, although lower than in town, is rather high in comparison with other types of property.

Table 12 Availability of Ownership of Extra Dwelling

Dwelling Type Number % Separate apartment 17 1, 1 Detached house 22 1, 5 Part of house 5 0, 3 Cottage (winter) 8 0, 5 Cottage (summer) 4 0, 3 Other 4 0, 3 Do not possess 1444 91, 4 No answer 71 4, 7

Total 1515 100, 0

A part of households – 15.4% also own garages or lease them from other owners – 0.7%.

84.0% of households either do not possess garages or did not provide an answer to this question.

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Table 14 Availability of Garage for House-owners

Number %

Private Use 233 15, 4

Lease 10 0, 7

Do not possess 1207 79, 7 No answer 65 4, 3

Total 1515 100, 0

C. Availability of Public Utilities in Households

Drinking Water. Drinking water needs in the households of the community is mainly satisfied by a traditional way: obtaining it from wells. 80.5% of households in the community get the water by this method. At the same time water in wells of Moldova is quite polluted with the after-products (pesticides etc.) Only 8.5% of households have running water, as a rule these are many-storied buildings.

Table 15 Availability of Drinking Water in Households and Type of Water Consumption

Type of Water Use Number % Running Water 129 8, 5

Spring 121 8, 0

Well 1220 80, 5

Other 30 2, 0

No answer 15 1, 0

1515 100, 0

Water of a bit better quality than the one from a well can be obtained from springs of natural origin. In Cucuruzeni community, 8.6% households supply themselves with water by this way.

On the whole, the problem with drinking water supply in Cucuruzeni community can be considered as safe: 97.0% of households have drinking water supply all the year round, 3% of households experience a difficulty in water supply (remoteness from wells and springs). Well development is an expensive issue (about $300) which is not affordable for young families that build houses far from the existing wells.

Heating. Heating period in the central part of Moldova, where Cucuruzeni community is situated, lasts approximately 170 days.

Table 16 Type of Household Heating

Type of Heating Number %

Central 3 0, 2

Autonomous 5 0, 3 Stove heating (gas) 87 5, 7 Stove heating (wood, coal, diesel

oil) 1403 92, 6

No answer 17 1, 2

1515 100, 0

Houses mainly are heated by stove heating (92.6% of households). Wood, coal and diesel oil are used as heating material. 0.5% have central/autonomous heating, and 5.7% of households have gas heating.

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Gas Supply. Most of households of Cucuruzeni community use gas for cooking, heating water, and other daily wants: 13.8% of them are connected up to the central gas-pipeline, and 61.2% use gas cylinders. A quarter of the households does not use gas at all – 18.0%, or use it so rarely that it was difficult for them to estimate the extent of gas use – 7.0%.

Table 17 Availability of Gas in Households

Gas Consumption Type Number %

Central 209 13, 8

Gas Cylinders 928 61, 2 No gas 272 18, 0 No answer 106 7, 0

Total 1515 100, 0

Hot Water Supply. In any household including the households in villages, it is impossible to do without hot water. 89.5% of households use hot water. At the same time one tenth of households does not use hot water for daily wants.

Table 18 Hot Water for Households

Number %

Hot water from public utility 4 0, 3 Heating up water with gas or

electricity

123 8, 1 Heating up water with wood or coal 1228 81, 1

Do not have hot water 121 8, 0 No answer 39 2, 5

Total 1515 100, 0

Availability of public utilities in households (electric power, telephone, sewerage, baths, and electric ranges). Main types of public utilities used by the community households can be conditionally divided into two groups. The first group includes availability of electricity and telephone (96.7% and 42.0% of households respectively) the second covers availability of bath, sewerage and electric ranges (6.9%, 6.1% and 0% respectively).

Table 19 Availability of Public Utilities in Households, (%)

Electricity Telephone Bath Sewerage Electric Range Hot Water Yes 96, 7 42, 0 6, 9 6, 1 - 89, 4 No 3, 0 54, 9 88, 4 89, 3 94, 3 8, 0 No answer 0, 3 3, 1 4, 7 4, 6 5, 7 2, 6 Total 100, 0 100, 0 100, 0 100, 0 100, 0 100, 0

Electricity. Sufficient availability of electricity for the households shows that this is the main and the only type of public utilities that the community villagers use. The more needy

households of the community do not have electricity supply.

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Telephone. Availability of telephone is also quite high – 42.0%; the expenses for telephone conversations are also huge.

Sewerage, Baths. There is minimum of baths and sewerage system available for households of the community and the part of households that have them is insignificant. Only 6.9% of households have baths. This can be explained by very high cost of power sources for water heating. Lack of sewerage can be explained by low consumption of water for daily wants in rural area.

Electric Ranges. Lack of electric ranges in the households can be explained both by that it is not traditional to use them in rural areas and by high cost of electricity. In addition, the tariff rate for electricity used for electric ranges in towns is lower than the rate charged for other forms of electric consumption, while no such special rate exists in the rural areas.

4.4. Household Appliances

Table 20 Age of Assets (number/years)

Age (years, %)

Item Number %

Up to 10

year-old % 11-20 % 21 -

30 % 31 - 40 % TV sets 1097 72, 4 448 47, 1 439 46, 1 191 20, 1 19 1, 2 Refrigerators 719 47, 5 142 19, 7 323 44, 9 232 32, 3 22 3, 1 Laundry washers 504 33, 3 181 39, 9 210 46, 3 99 21, 8 14 3, 1 Cars 143 9, 4 140 97, 9 1 0, 7 2 1, 4 - -

Among main types of household appliances that are in households property TV sets prevail they are met in 72.4% of households. Next are refrigerators – in 47.6% of households. One third of households possess laundry washers – 33.3% and few households have cars – in 9.4%

of households; though, 16.1% of households showed that they have garages.

Table 21 Term of service of household appliances owned by households

Up to 10 years 11-20 years 21-30 years 31-40 years Total TV set 40, 8 40, 0 17, 4 1, 8 100 Refrigerator 19, 7 47, 6 32, 1 3, 4 100 Laundry washer 35, 9 41, 7 19, 6 2, 8 100 Car 97, 9 2, 1 - - 100 Agricultural

vehicles

100 - - - 100

As it can be seen, the household appliances that were bought in Soviet times 59.2% of TV sets 80% of refrigerators and about 65% of laundry washers have been in operation for more than ten years. Nowadays most of households do not have funds to purchase new and more effective household appliances. At the same time in comparison with the past in Cucuruzeni community and in rural areas of Moldova on the whole the number of cars, mainly

secondhand models, drastically increased.

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5. Sources and Amount of Cash Income of the Community Households

5.1. Amount of Cash Income

The problem of cash income in rural communities of the Republic of Moldova is a topical one. As a result of economic crisis that struck agriculture as well, the possibilities for rural population to gain cash income have become quite limited. The reason of this is weak economy activity after the land privatization and high level of both hidden and evident unemployment in rural areas.

The study that was carried out with the help of UAF showed that for 1104 households of Cucuruzeni community, which gave information about received cash income, the total amount of incomes made up 449558 MDL (32.6 thou USD) in January 2003. A quarter of households (27.1% or 411) did not show any data about received cash income. Taking this into account, analysis is carried out with respect of 1104 households that make up 72.9% out of their total number in the community which is representative enough for the assessment of situation with cash income in all the aggregate of the community households.

An average monthly cash income per household is 407.2 MDL (29.5 USD) with quite a big range of differences – from 12 MDL (0.9 USD) up to 16635 MDL (1205 USD).

Median divides the number of households into two equal parts by 552 households, incomes in one of the parts are less than the median and amount to 81784 MDL (5.9 thou USD); and in the other part they are higher as come up to 363137 MDL (26.7 thou USD). The income of the latter part of households is by 4.4 times higher than of the first one.

Mode (the most frequently met value in the sample) is represented by several groups. Among them the most significant are the following: 200 MDL (frequency 34), 300 (frequency of values 25), 120 –140 MDL (frequency of values 22).

Table 22 Division of 1104 households into five quintiles of households

% 5, 0 8, 5 11, 4 17, 3 57, 7 100, 0 MDL 22, 438 38, 396 51, 432 78, 001 259, 289 449, 558 Average Income

MDL 101, 6 173, 5 232, 9 353, 3 1174, 3 407, 2

As we can see the difference between Group One and Group Five is quite considerable.

Group Five receives incomes by 11.6 times more than Group One. In percentage terms the cash incomes of Group Five amount to 57.7% (259289MDL) out of total income, and the income of Group One is 5.0% (22438MDL).

The average income in Group Five of households is 11743 MDL (851 USD) and in Group One – 101.6MDL (7.4 USD).

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Table 23 Distribution of Households by Cash Income per One Member of Household, %

Cash Income per One Member of

Household, MDL Number of Households % Less than 40 167 15, 2

41-100 273 24, 8

101-200 525 47, 6

201 - 500 119 10, 8

Over 500 18 1, 6

1102 100, 0

As we see 40% of households have monthly cash income that does not exceed 100 MDL (7.3 USD) and only 1.6% of households have cash income over 500 MDL (36.3 USD). Certainly that 15.2% of households (every eighth) which income is lower than 40 MDL (2.9 USD) are in poverty zone.

5.2. Salary, Pension and Social Benefits

The findings show that the total amount for three above-mentioned types of cash income for January 2003 came up to 360159 MDL (26.1 thou USD).

On recalculating it per every inhabitants of the community this makes up 80.7 MDL (5.85 USD). Salary prevails in the structure of cash income – 55.2%, next are pensions – 40.5% and various social benefits – 3.9%.

It is indicative that the sum of incomes in salaries is just slightly higher (by 51.5 thousand MDL) than the sum of incomes received from pension payments. This is explained both by that in social-demographic structure of the community - there is a significant weigh of persons of pension age - and by that that till now business in rural area has not been developed enough and opportunities to earn money are limited.

Salary. The total number of employees that worked for salaries in the community was 580 persons or 45.8% of active population of the community.

The total amount of salary received for one month made up 198923 MDL. On recalculating this per inhabitant the income comes up to 44.6 MDL (3.2 USD). Amplitude of variation between the minimal and maximal salaries is great: 3 MDL and 5200 MDL.

Median shows that equal number – 50% - receives salary in the following relation 20.0% and 79.0%. The average salary is 343 MDL (24.9 USD).

Table 24 Distribution of Salary by Five Groups

Quintiles

1 2 3 4 5

4, 9 10, 0 13, 5 21, 2 50.4

It may be seen that 50.4% of the received salaries account for Group Five, while only 4.9%

fall on Group One, the gap is rather significant. Group Five received salaries in total sum by 10.3 time more than Group One.

Pension Payments. The total sum of pension payments for the community is 147421 MDL, the average size of pensions is 150 MDL (10.86 USD). The total number of pensioners is 982.

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Table 25 Distribution of Pension Payments by Five Groups

Quintiles

1 2 3 4 5 11, 4 17, 3 19, 8 22, 0 29, 5

There are by 2.6 times more payments that fall on Group Five of pensioners than on Group One. At that, differences in volume of cash payments between Group One and Group Five are lower than it is in the case of salaries.

Social Benefits. The total sum of social benefits for the community is 13815 MDL, they are received by 275 persons; on average there are 50.2 MDL/month per beneficiary (3.64 USD).

Distribution of cash benefits by five groups of proportional observations is the following:

Table 26 Distribution of Cash Benefits by 5 Groups

Quintiles

1 2 3 4 5 5, 7 7, 2 8, 5 16, 5 62, 1

We see that social benefits also dispersed quite non-uniformly. Group Five receives the sum of social benefits that by 11 time exceeds the social benefits sum of Group One.

Median divide the group of those who receive social benefits into two equal parts by the number of observations. 2274 MDL (16.5%) of social benefits fall on the first part and 11541 MDL (83.5%) onto the second.

5.3. Income from Land Ownership

The land in rural area of the country is of the greatest value for the population. Availability of land, its quantity and quality reflects the level of well-being of households. Land gives a possibility for villagers to gain income and food products as a result of its cultivation or leasing. As finding of the study show 90% of households of the community own arable field and 89.9% - a small plot adjacent to the house. At the same time it brings to notice

appearance of households that do not possess land: 10.0% of them do not own any plough- land and 10.1% do not have adjacent plot of land. It is evident that the process of

dispossession of land of households in the community will continue including on the basis of selling the land by the needy layers of the population and consolidation of large areas in the hands of more well-to-do persons. Although the majority of households (58.9%) possess 1-3 Hectares of land, almost one third of households (31.1%) have more than 3 Hectare.

Table 27 Distribution of Households by Availability of Arable Land

Number of Households Size of Land Property, ha %%

209 Less than 1 13, 8 684 From 1, 01 to 3 45, 1

471 Over 3 31, 1

151 - 10, 0

1515 100,0

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The category of households that do not own land for agriculture (10.0%) includes village intelligentsia, part of which has not been granted with land ownership and young families that separated from their parents who owned the land then and still own it at present.

Traditionally important in rural area is property of land adjacent to the house; it provides the household with agricultural products of day-to-day consumption.

Table 28 Distribution of Households by Availability of Small Plots Adjucent to the House

Number of Households Size of Plot, acre %%

173 Less than 6 11, 4

1071 7 – 30 70, 7

118 Over 30 7, 8

153 No land 10,1

1515 100, 0

It can be seen that about 11% of households do not possess adjacent plots and, as a result, do not have an additional source of income. It is evident that these households experience

difficulties with domestic animal and poultry farming. This category mainly includes owners of privatized apartments, those who lease or hire rooms etc. At the same time more than 70%

of households have rather large adjacent plots of land and 7.8% of households own plots that are over 30 acres in size

Cattle and poultry is an important support for survival of households. In the Cucuruzeni community 51.5% of households have cattle, 48.1% - pigs, 24.4% - goats and sheep and 12.9% - horses. 86.0% of households keep poultry. The products of stock-raising is mostly used for household consumption. Marketability of stock-raising is small unlike the grain production or wine-growing. It is limited both by lack of development of a correspondent infrastructure for purchase of milk, meat, leather, wool etc. and by lack of SMEs on site in villages.

6. Expenditures of Households

6.1. Structure and Amount of Expenditures. Main Groups of Expenditures

Total sum of expenditures of all households of the Cucuruzeni community for domestic needs, medical services and education, as well as for payment of taxes in January 2003 accounted for 987774 MDL (71.6 thou USD).

Table 29

Number of

households Types of

expenditures Total Minimal expenditures Maximal

expenditures Average sum per one household

1473 Food 334516 10 4000 227,0 1110 Healthcare 225307 5,0 7000 203,0 450 Education 72192 5,0 2,500 330,0 653 Phone 32997 0,6 926,0 50,5 1381 Electric power 67347 0,7 16056 48,8 450 Gas supply 52992 1,0 500,0 116,9 78 Water supply 2187 0,5 355,0 28,0 419 Heating 121498 2,0 3250,0 290,0 84 Private transport 19505 9,90 1200,0 232,2 1111 Public transport 56258 5,0 640,0 50,6 19 Taxes 2975 30,0 319,0 156,6

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Food. Expenditures for food made up 334516 MDL or 33.9% of the total expenditures per month. Only 2.8% households indicated no monetary expenditures for food. These

expenditures are in the lead as regards both total expenditures and number of households – 97.2%.

Expenditures of households differ. And this difference can be quite considerable. Although on average every household spent 227 MDL (16.5 USD), the minimal expenditures formed 10 and the maximal – 4000 MDL.

Division into five quintiles shows how big is the difference between the first and the fifth groups of households as regards expenditures for food.

Table 30

Groups Expenditures, MDL Expenditures, % Average value, MDL

1 16848 4.9 55,9

2 32552 9.7 110,5

3 51013 15.2 173,2

4 71801 21.5 243,7

5 162666 48.6 552,1

Total 334516 10.0 227,1

As we can see, difference in expenditures between the first and the fifth quintiles is 146182 MDL. The fifth quintile spends 10 times more money for food than the first one.

Electric power. Expenditures for electric power were 67347 MDL (4.9 thou USD). This is the second type – after food – in dependence on the number of households – 1381. At the same time, only 6.8% of the total expenditures fall at electric power.

Differences by quintiles are essential. Thus, the fifth group of households spends for electric power 17 times more money than the first one. Data on expenditures of five groups of households are shown below.

Table 31

Groups Expenditures, MDL Expenditures, % Average value, MDL

1 2386,05 3.5 8,6

2 5017,19 7.4 18,2

3 7985,80 11.8 28,9

4 11284,80 16.7 40,8

5 40672, 92 60.4 147,2

Healthcare. Expenditures for healthcare (medicines, polyclinic, hospital) turned to be

unexpectedly great – 225307 MDL or 16.3 thou USD (22.8% of the total expenditures); they were noted by 1111 households (73.3%).

Division of households into quintiles demonstrates amount of means spent for healthcare in five groups similar in number.

Table 32

Q1 Q2 Q3 Q4 Q5

% 1.8 4.3 7.9 10.9 75.1 MDL 4059 9732 17758 24644 169114

Findings of the Targeted Survey

Testing of the Unified Application Form and Exclusion Error of

the Nominative Targeted Compensations Program

Testing of the Unified Application Form and Exclusion Error of

the Nominative Targeted Compensations Program

Findings of the Targeted Survey

of the Cucuruzeni Rural Community Population, Orhei District

Table of Contents

Abstract

Introduction

1. Logics of Transformation of Moldova’s Social Assistance System: Mass Privileges – NTC to Certain Categories –

Social Assistance Based on Needs

2. Object for Testing the Unified Application Form:

Population of the Cucuruzeni Rural Community, Orhei District

3. Socio-demographic Structure of the Community

4. Dwelling of the Population and Property

5. Sources and Amount of Cash Income of the Community Households

6. Expenditures of Households